Oil fell to its lowest in 13 days in New York, widening its discount to Brent crude to the most this year. U.S. crude and gasoline stockpiles rose last week, an industry report showed.
West Texas Intermediate futures declined as much as 1.5 percent. WTI’s discount to London-traded Brent widened for a sixth day as limits on the Seaway pipeline cut flows to Gulf Coast refineries. U.S. crude supplies rose by 3.63 million barrels, the American Petroleum Institute said. Energy Department data due today will probably show oil inventories rose to a seven-week high. The U.S. will tighten sanctions on Iran today with measures blocking the exporter from repatriating oil payments in dollars, euros and other hard currencies.
“We’re moving into the refinery maintenance season so that could affect crude stock builds, at the end of this quarter demand should go lower,” said Thina Saltvedt, an analyst at Nordea Bank AG, who predicts that prices will remain supported at current levels by geopolitical concern and improved demand for riskier assets.
Crude for March delivery dropped as much as $1.45 to $95.19 a barrel in electronic trading on the New York Mercantile Exchange, the lowest since Jan. 24, and was at $95.37 at 1:16 p.m. London time. The contract rose 0.5 percent yesterday, the biggest gain since Jan. 29. Prices slid 1.6 percent on Feb. 4, the most since Dec. 6.
Brent for March settlement fell 62 cents to $115.90 a barrel on the London-based ICE Futures Europe exchange. The volume of all WTI contracts traded at that time was 66 percent above the 100-day average, while Brent was 35 percent higher.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.